U.S. West Texas Intermediate (WTI) crude futures also equalled a November 2018 high of $60.27 per barrel on Thursday.

Crude prices have been pushed up by almost a third since the start of 2019 by supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC), as well as by sanctions enacted against Iran and Venezuela by the United States.

OPEC’s crude oil output has slumped from a mid-2018 peak of 32.8 million barrels per day (bpd) to 30.7 million bpd in February.

The U.S. sanctions are also disrupting supply.

“Venezuelan exports to the U.S. have finally dried up, after the sanctions were placed on them by the U.S. administration earlier this year,” ANZ bank said on Thursday.

Iranian oil exports have also slumped. The United States aims to cut Iran’s crude exports by about 20 percent to below 1 million bpd from May by requiring importing countries to reduce purchases to avoid U.S. sanctions.

The OPEC cuts and sanctions have also tightened supply within the United States.

U.S. crude oil stockpiles last week fell by nearly 10 million barrels, the most since July, boosted by strong export and refining demand, the Energy Information Administration said on Wednesday.

Stockpiles fell 9.6 million barrels, to 439.5 million barrels, their lowest since January.

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International Brent crude oil futures were at $67.50 a barrel at 0222 GMT, down 11 cents, or 0.2 percent, from their last close. Brent touched $68.20 a barrel on Tuesday, its highest since Nov. 16.

U.S. West Texas Intermediate (WTI) crude futures were at $58.83 per barrel, down 20 cents, or 0.3 percent, from their last settlement. WTI hit a high of $59.57 a barrel on Tuesday, the highest since Nov. 12.

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Oil prices dipped on Wednesday, retreating from a four-month high as economic growth concerns dampened the outlook for fuel consumption.

However, analysts said oil was still well supported by voluntary supply cuts led by producer club OPEC and U.S. sanctions against Iran and Venezuela.

International Brent crude oil futures were at $67.50 a barrel at 0222 GMT, down 11 cents, or 0.2 percent, from their last close. Brent touched $68.20 a barrel on Tuesday, its highest since Nov. 16.

U.S. West Texas Intermediate (WTI) crude futures were at $58.83 per barrel, down 20 cents, or 0.3 percent, from their last settlement. WTI hit a high of $59.57 a barrel on Tuesday, the highest since Nov. 12.

Analysts said the dip was mostly down to concerns that an economic slowdown could soon dent fuel consumption.

The dips come after crude prices rose by more than a quarter this year, pushed up by a pledge led by the Organization of the Petroleum Exporting Countries (OPEC) to withhold around 1.2 million barrels per day (bpd) of supply as well as by U.S. sanctions against oil exporters Iran and Venezuela.

“The shaky supply outlook with regard to Venezuela and Iran, as well as the petro-nations’ output restrictions are top of mind in the oil market,” said Norbert Ruecker, head of economics at Swiss bank Julius Baer.

Ruecker said oil prices were likely capped around $70 per barrel as fuel price inflation, as seen last year, would hit demand at that level.

At the same time, he said oil prices were supported above $50 per barrel as investment into U.S. shale output growth would cease below that price.

Between those price levels, Ruecker said “the U.S. shale boom almost fully meets global oil demand growth mirrored by the strongly expanding crude oil exports,” which hit a record 3.6 million bpd in February.

“We see … roughly 1.2 million bpd of U.S. shale oil growth over the coming year,” Ruecker said, which is in line with most global oil demand growth forecasts of 1 million to 1.3 million barrels per day for 2019.

The U.S. Energy Information Administration (EIA) is due to publish its weekly crude production and storage level report around 1700 GMT on Wednesday.

U.S. sanctions against oil producers Iran and Venezuela are also boosting prices, although traders said the market may be capped by rising U.S. output.

U.S. West Texas Intermediate (WTI) futures were at $59.14 per barrel at 0746 GMT, up 5 cents from their last settlement and close to the 2019 high of $59.23 reached the previous day.

Brent crude oil futures were up 20 cents at $67.74 per barrel, also close to this year’s peak of $68.14 marked late last week.

In China, Shanghai crude futures, launched in March last year, bounced 4.5 percent from their last close to 468.2 yuan ($69.71) per barrel, also near 2019 highs of 475.7 yuan a barrel hit during a brief spike in February.

In dollar-terms, this pushed Shanghai crude into a premium over Brent.

The Organization of the Petroleum Exporting Countries (OPEC) on Monday scrapped its planned meeting in April, effectively extending supply cuts that have been in place since January until at least June, when the next meeting is scheduled.

OPEC and a group of non-affiliated producers including Russia, known as OPEC+, started withholding supply to halt a sharp price drop in the second-half of 2018, when markets came under pressure from surging output as well as an economic slowdown.

“The OPEC+ deal has brought stability to crude prices and signs of an extension have taken crude higher,” said Alfonso Esparza, senior market analyst at futures brokerage OANDA.

Prices have been further supported by U.S. sanctions against oil exports from Iran and Venezuela, traders said.

Because of the tighter supply outlook for the coming months, the Brent forward curve has gone into backwardation since the start of the year, meaning that prices for immediate delivery are more expensive than those for dispatch further in the future, with May Brent prices currently around $1.20 per barrel more expensive than December delivery Brent.

Outside OPEC, analysts are eyeing U.S. crude oil production, which has soared by more than 2 million barrels per day (bpd) since early 2018, to around 12 million bpd, making the United States the world’s biggest producer ahead of Russia and Saudi Arabia.

Weekly output and storage data will be published by the Energy Information Administration (EIA) on Wednesday.

On the demand-side, there is concern that an economic slowdown will erode oil consumption.

Bank of America Merrill Lynch said in a note that economic “risks are skewed to the downside” and that “we forecast global demand growth of 1.2 million bpd year-on-year in 2019 and 1.15 million bpd during 2020”.

The bank said it expected “Brent and WTI to average $70 per barrel and $59 per barrel respectively in 2019, and $65 per barrel and $60 per barrel in 2020.”

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Brent crude oil futures were at $67.03 per barrel at 0231 GMT, down 13 cents, or 0.2 percent, from their last close, but not far off the $68.14 per barrel 2019-high reached last week.

U.S. West Texas Intermediate (WTI) futures were at $58.32 per barrel, down 20 cents, or 0.3 percent, from their last settlement, and also not far off their 2019-high of $58.95 from the previous week.

Despite the lower prices, crude markets remain broadly supported by supply cuts led by producer group OPEC and U.S. sanctions against Iran and Venezuela.

A truck used to carry sand for fracking is washed in a truck stop in Odessa, Texas.

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Oil prices dipped on Monday amid concerns that an economic downturn may dent fuel consumption, but crude markets remain broadly supported by supply cuts led by producer group OPEC and U.S. sanctions against Iran and Venezuela.

Brent crude oil futures were at $67.03 per barrel at 0231 GMT, down 13 cents, or 0.2 percent, from their last close, but not far off the $68.14 per barrel 2019-high reached last week.

U.S. West Texas Intermediate (WTI) futures were at $58.32 per barrel, down 20 cents, or 0.3 percent, from their last settlement, and also not far off their 2019-high of $58.95 from the previous week.

“The greatest downside risk to our oil price view is demand weakness on slower economic growth. Our base case is that global oil demand will increase by 1.3 million barrels per day (bpd) in 2019… A synchronized global slowdown in growth could push global demand growth to below 1 million bpd,” Bernstein Energy said on Monday.

U.S. manufacturing output fell for a second straight month in February, in a sign that the world’s biggest economy has been slowing down in the first quarter.

In Asia, Japan’s exports fell for a third straight month in February in a sign of growing strain from slowing global demand.

Despite this, oil prices have gained around a quarter since the start of the year amid U.S. sanctions against Iran and Venezuela, and as the Organization of the Petroleum Exporting Countries (OPEC) and non-affiliated allies like Russia — known as OPEC+ — have pledged to withhold 1.2 million bpd in supply to prop up prices.

OPEC’s de-facto leader Saudi Arabia said on Sunday that balancing oil markets was far from done as inventories were still high.

Russia also said production cuts would stay in place at least until June.

As a result, Bernstein forecast an inventory draw of 37 million barrels in the first quarter for the 36 member countries of the Organisation for Economic Co-operation and Development (OECD), which comprises most industrialized nations.

The International Energy Agency (IEA) said on Friday it expected oil markets to be in a modest deficit from the second quarter of 2019.

Key for the supply and demand balance will be the United States, where crude production has soared by around 2 million bpd over the past year, thanks largely to an onshore boom in shale formation drilling.

The number of rigs drilling for new oil production in the United States has been falling in 2019, and hit its lowest level since April 2018 last week, at 833 operating rigs.

However, U.S. crude oil production still increased at the start of 2019, hitting a record 12.1 million barrels per day (bpd) in February, data from the Energy Information Administration (EIA) showed.

Output has since dipped back to 12 million bpd, but that still makes America the world’s biggest crude oil producer.

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Brent crude oil futures were at $67.27 per barrel at 0425 GMT, 4 cents above their last close, and within a dollar of the $68.14 2019-high reached the previous day.

U.S. West Texas Intermediate (WTI) crude oil futures were at $58.63 per barrel, 2 cents above their last settlement, and not far off their 2019-high of $58.74 from the previous day.

Despite Friday’s dips, oil has rallied around a quarter since the start of the year.

A pump jack and pipes at an oil field near Bakersfield, California.

Lucy Nicholson | Reuters

Oil prices were firm on Friday amid production cuts led by OPEC and as U.S.sanctions against Venezuela and Iran likely created a slight deficit in global supply in the first quarter of 2019.

But oil prices have been capped by concerns that an economic slowdown will soon start denting growth in fuel demand.

Brent crude oil futures were at $67.27 per barrel at 0425 GMT, 4 cents above their last close, and within a dollar of the $68.14 2019-high reached the previous day.

U.S. West Texas Intermediate (WTI) crude oil futures were at $58.63 per barrel, 2 cents above their last settlement, and not far off their 2019-high of $58.74 from the previous day.

Despite Friday’s dips, oil has rallied around a quarter since the start of the year.

“Crude oil continues to grind higher…in response to ongoing production cuts from the OPEC+ group of producers as well as another (output) slump from a blacked-out Venezuela,” said Ole Hansen, head of commodity strategy at Denmark’s Saxo Bank.

The Organization of the Petroleum Exporting Countries (OPEC) and non-affiliated allies such as Russia — known as the OPEC+ alliance — pledged to withhold 1.2 million barrels per day (bpd) in crude supply from the start of the year to tighten markets and prop up prices.

OPEC+ will meet in Baku, Azerbaijan, over the weekend to review its output policy, although most expect the cuts to continue for now.

“We don’t think anything will be agreed this weekend. But, we suspect the group will make noise about the ongoing effort to keep this market in balance,” ANZ bank said on Friday.

Meanwhile, U.S. sanctions against Venezuela as well as Iran have further tightened oil markets.

With OPEC voluntarily withholding supply and U.S. sanctions preventing Iranian and Venezuelan oil from entering markets, global crude flow data in Refinitiv showed a slight supply deficit likely appeared in the first quarter.

Will demand hold up?

Preventing oil from rising further have been concerns that a economic slowdown that has gripped large parts of Asia and Europe, and which is showing signs of spilling into North America, will soon dent fuel demand growth.

But oil demand has held up well so far.

Crude oil use in China, the world’s biggest importer, in the first two months of 2019 rose 6.1 percent from a year earlier to a record 12.68 million bpd, official data showed this week.

“Oil demand concerns are overdone,” Goldman Sachs said in a note on Friday.

The U.S. bank said January global crude oil demand growth was “nearly 2.0 million barrels per day, with strength visible in both emerging markets and developed economies”.